In the context of cryptocurrencies, a peer-to-peer (P2P) network is a decentralized network architecture where participants (peers) communicate and interact with each other directly, without the need for intermediaries such as servers or central authorities.
P2P networks are the foundation of most cryptocurrencies, as they allow for the creation of a trustless system, where participants can transact with each other without the need for a trusted third party to facilitate the transactions. In a P2P network, each node (computer) in the network acts as both a client and a server, meaning that it can send and receive data to and from other nodes in the network.
In a cryptocurrency P2P network, each node maintains a copy of the blockchain, which contains a record of all transactions that have ever occurred on the network. When a new transaction is initiated, it is broadcasted to all nodes in the network, which then verify the transaction and add it to their copy of the blockchain if it is valid.
P2P networks in cryptocurrencies are resilient to attacks and failures, as there is no single point of failure or control. This means that the network can continue to operate even if some nodes are compromised or go offline, ensuring the security and integrity of the system.
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